NHS England Forward View appears procurement blinkered

Today NHS England launched its Five Year Forward View - of course it is no surprise that the NHS faces an enormous financial black hole, around £8bn!  What is surpassing though, faced with money needs, is that in 38 pages procurement/purchasing only get two mentions. The first relates using purchasing power to improve the 'health warning on labelling, and the second, the grand IT system procurement failures:

... So for all of these major health risks – including tobacco, alcohol, junk food and excess sugar - we will actively support comprehensive, hard-hitting and broad-based national action to include clear information and labelling, targeted personal support and wider changes to distribution, marketing, pricing, and product formulation. We will also use the substantial combined purchasing power of the NHS to reinforce these measures. 

Part of why progress has not been as fast as it should have been is that the NHS has oscillated between two opposite approaches to information technology adoption – neither of which now makes sense. At times we have tried highly centralised national procurements and implementations. When they have failed due to lack of local engagement and lack of sensitivity to local circumstances, we have veered to the opposite extreme of ‘letting a thousand flowers bloom’. The result has been systems that don’t talk to each other, and a failure to harness the shared benefits that come from interoperable systems.

This strikes me as a terrible indictment, that in addressing such a financial shortfall, procurement gets such a 'bit part' and that one is about the woes of an ill-conceived and delivered IT strategy.

Has NHS England decided it has exhausted the 'procurement opportunity pot', has it decided getting the value from 'the pot' is too hard, or has does it just overlooked the 'procurement pot of gold'?  I know there are some great people and ideas in NHS procurement - why has their contribution been overlooked?  

Is the Tesco storm indicative of a governance & policy failure?

Today's news that allegedly three more Tesco staff, who have links with procurement, have been suspended continues to rub salt in the wound and negatively impact on reputation.

While I have discussed Tesco's procurement many times, I now find myself asking: "is the weakness in the governance and policy as opposed to the people?"

If the press are correct, those suspended now include: the commercial director, the food commercial director, three category directors (group wine director, director of convenience foods, and director of impulse purchases) and someone responsible for sourcing.

It seems impossible to believe all those suspended are mavericks or indeed that they were pursuing a strategy concealed from those with strategic oversight. If that is possible, then how many other areas of Tesco's governance lacked scrutiny?

Nevertheless, it may be a good time to gain insights into the procurement governance and policy of Tesco. If that was a fault, you can hardly blame the staff. Even if Tesco replace the staff, in the absence of addressing governance and policy failures, the corrections will only be cosmetic.

It may also be a good time for those charged with procurement governance and policy to ask, "could Tesco's woes be replicated here?".

More Teswoe's - and thoughts on the linkage of Marketing & Procurement Strategy

With the slogan 'Every little helps' Tesco are also sure to understand the drip, drip, drip of every little piece of negative publicity also counting. I have given considerable attention to Tesco's approach to procurement over the years and how it may not have been just exemplary as others argued.

However, today's Sunday Times article drew my attention to an aspect of Tesco procurement strategy that I previously hadn't considered, namely, minimising customer choice. I just hadn't considered that the strong arm of Tesco's buyers were suspending products from the shelves - customers were being deprived of choice by Tesco. Of course the suspension also had a painful impact on suppliers. Ironically Premier Foods lost £10m in three months. I say ironically as you may recall, some months ago, I referred to Premier Foods bizare approach to defining strategic suppliers.

While these case studies are of interest to the procurement world, to me they are also of interest to those interested in Marketing Strategy. Did Marketing in Premier Foods position Tesco as strategic - clearly Tesco's Procurement Strategy didn't position Premier Foods as strategic. And what about the reputational damage caused by Tesco's Procurement Strategy - never mind that a number of the Tesco staff are now suspended, how much will Brand reconstruction cost. Wouldn't it be interesting to read the brief for the procurement of that Brand agency who have to undo the damage caused by Procurement!

Marvel at the superheroes of central government procurement once again

Today's Business Section of the Sunday Times carried an interesting piece on the work of Bill Crother's in central government - he has clearly taken on the mantel of a superhero. What caught my eye was Crother's statement: “Where we have come from four years ago, we’ve made great strides, but there’s a long, long way to go.” 

I do not deny that significant progress may well have been made, but what I think we are all due is an explanation as to why the situation was, and continues to be so bad? When I reflect on the last 20 years we have had many in central government also implying they were procurement superheroes and often adopting quite an arrogant stance telling the NHS and local government 'how to do it'. Where are they now and what dod they actually leave behind - if Crother's is right, a mess. I will not start to name the names, but surely there is a need for some 'calling to account' as to what they actually achieved from their lofty positions - was it all rhetoric? It would be quite easy to do a trawl of Supply Management, for example, and read the how the superheroes of the past were going to sort out public procurement. They were held up as exemplars but never fell. They were never to blame, but sorting out a mess they had inherited! Sound familiar? 

As I see it we are likely to see this repeated over and over again because there does not appear to have been any meaningful performance management system which the incumbents answer to, nor any retrospective personal accountability. Call me a cynic, but before you do, tell what's actually changed over the last four years and how the latest superhero will be called to account?